Crypto developers know something you don't

Plus Bitcoin vs quantum computing and the SEC's attempt to murder DeFi

New to crypto? Cryptocurrency Basics is a 9 minute video that serves as a great intro to the world of crypto.

Are you about to have your juicy DeFi yields taken away? Is Bitcoin’s long-term security at risk? Is crypto in general doomed?! The waves are choppy right now… anybody feel like surfing? If not… today’s NITRO! will keep you distracted!

In this issue:

1. What crypto developers know that you don’t

2. Bitcoin vs quantum computing

3. Is the SEC trying to ruin DeFi?

What crypto developers know that you don’t

In the Crypto Pragmatist newsletter I came across the following which might go some way toward boosting your confidence when it comes to crypto’s longer-term prospects:

Talent has flocked to cryptocurrency and Web3 over the last year, with more than 34,000 developers freshly onboarded to crypto in 2021. Why does this matter? Developers build products, consumers use those products, which generates revenue, generating return for investors, then more investments are made, then more products are built by developers, then more consumers, then…you get it.

On some level, developer activity is the core activity related to the growth of the crypto ecosystem: without unique and talented developers creating in the space, there would be nothing valuable to invest in. The fact that crypto is growing and innovating so quickly is directly due to the talent it can attract.

So, by default, the ecosystems that attract the most innovative talent will be the most successful ones.

Smart people don’t flock to work in dying sectors.

Bitcoin vs quantum computing

If you recall I pointed out in yesterday’s issue that quantum computing could eventually pose a threat to crypto. The question is… how eventually is eventually? A recent report covered here by The Daily HODL gives a breakdown of how much quantum computing power would be required to wreck Bitcoin’s security:

“State-of-the-art quantum computers today only have 50-100 qubits. Our estimated requirement of 30 [million] to 300 million physical qubits suggests Bitcoin should be considered safe from a quantum attack for now, but devices of this size are generally considered achievable, and future advancements may bring the requirements down further.”

When going off of Webber’s estimates, quantum computing would have to increase 300,000 times on the low end and 6,000,000 times on the high end to breach Bitcoin’s security.

Long story short: someday quantum computing could pose a threat to Bitcoin but that’s not happening anytime soon. Even so there would be at least one potential solution:

The report concludes that while Bitcoin could mitigate the security risk by hard-forking into quantum encryption, the increased memory requirements would likely affect the network’s overall efficiency.

Is the SEC trying to ruin DeFi?

Gabriel Shapiro’s recent newsletter on some SEC regulation had crypto Twitter fired up today.

RYAN SΞAN ADAMS - rsa.eth 🦇🔊 @RyanSAdams

The SEC is attacking DeFi. They're trying to expand the definition of 'securities exchange' to include AMMs & DeFi protocols, maybe wallets & block explorers too. Giving only 30 days to comment so they can slip it through. They want to kill crypto in the U.S.

Depending on who you follow… it’s either the end of the world or… not.

Kristin Smith @KMSmithDC

Agreed. This is not another infrastructure situation. We are having a constructive dialogue with decision makers who are open to input. More work to do, but way better than the situation in August.

Jake Chervinsky @jchervinsky

It was a busy but productive day. After a few good conversations, I'm optimistic that today's legislative situation will end up fine. Don't lose any sleep over it tonight.

Crypto is going to be a BIG issue for voters in the US from now on. For many it will be the singular issue that causes them to vote one way or another for any given candidate (for better or worse).

NITRO!

A little something extra for those of you who aren’t quite ready to be done with another useful issue of TGO!

• Cool: The Daily Ape (WOW that’s a lot of useful crypto info!)

• News: Tim Cook says Apple ‘sees a lot of potential’ in the metaverse, ‘investing accordingly’

• Learn: The term “risk on” refers to the market sentiment where traders and investors in the financial market are taking on risk. In a “risk on” environment, you'll notice prices of high-risk assets such as stocks and commodities rising and safe-haven assets such as the Japanese yen and gold falling.

• Thread: “…the question isn’t whether web3 is, in its current state, an unstoppable democratizing force. It is whether web3 represents progress toward a net better society—compared to the status quo.”

See you tomorrow!